It’s hard to believe, but the good-hearted deed of donating your car to charity can seriously affect your auto insurance premiums. This comes as an unexpected surprise to many generous individuals and businesses after they’ve joined the growing trend of donating a vehicle. And, it isn’t necessarily a pleasant surprise either. While a number of different factors can impact your auto insurance premiums, a simple donation of an unwanted vehicle could have you wondering what hit you when your renewal statement arrives.
Rightly so, many people feel that by donating a car in California, they’ll automatically enjoy the benefit of a reduction in their auto insurance rates. However, they may be disappointed when they learn that this isn’t always the case. Insuring one vehicle rather than two will likely cause their auto insurance premiums to go down, but often the savings are not as substantial as they had expected. In fact, sometimes the savings are minimal, as they no longer qualify for the multiple car discount and the single car rate rises, making the savings virtually insignificant.
That’s why, it’s so important to do your research and compare your auto insurance rates before you decide to donate in order to realize any potential savings or possible rate hikes. Of course, trend or no trend, it goes without saying that donating a car to a good cause is a noble gesture, but don’t ignore the benefits of being eligible for a multi-car discount. There’s nothing worse than suddenly finding out that your expectations of experiencing a rate drop are replaced with the shock of seeing that you’re actually paying slightly more for your single car coverage every six months because the discount is no longer in effect.
Unfortunately, this is a fact that isn’t just difficult to understand – it’s even harder to explain. It’s simply something many insurance companies do and, as a policy holder, you really don’t have many options, except to look for a better rate. So, think before you act, or it could end up costing you money on your insurance premiums.
If you’re intent on donating your vehicle, by all means, do it. After all, there are still many positives to donating a car in California. Some of the benefits include helping those less fortunate and in need, possible tax credits, upfront cash, and getting rid of a car that doesn’t run – or is nothing more than an eyesore in the driveway or back yard. When weighing these obvious advantages, it certainly makes the generous deed a more worthwhile act.
It’s also helpful to keep in mind that if you’re planning to donate the older car and replace it with a new car, you can expect your auto insurance rates to rise significantly. Furthermore, should you have a teenager who will be driving the newer car as opposed to the older one, be prepared for a serious shock when you add them to your coverage.
Consider all your options and consult with your insurance agent to understand all possible consequences before following through with any decision that, in the long run, could be more of a negative than a positive.
One definite positive is making sure you’re getting the best rate on your auto insurance. Why not get a free auto insurance quote today?